US tariffs may impact Việt Nam’s aluminium and steel exports

While Việt Nam is not the largest exporter of steel and aluminium to the US, domestic businesses will still face significant challenges due to this policy.

US President Donald Trump’s 25 per cent tariff on imported steel and aluminium, effective March 4, aims to protect its domestic industry — but it will pose challenges for Vietnamese businesses.

According to the Vietnam Steel Association (VSA), the US is currently the third-largest export market for Vietnamese steel, accounting for 13 per cent of total export turnover, behind ASEAN and the EU. Although this level of dependence is not particularly high, the new tariffs could still impact major steel producers in Việt Nam.

Trương Hiền Phương, Senior Director at KIS Việt Nam Securities, told baodautu.vn that the tariffs will certainly affect Vietnamese steel exports but not to a severe extent, as the US does not constitute the majority of total steel export revenue. Companies like Hòa Phát Group, Hoa Sen and Nam Kim Steel still have alternative markets to compensate for potential losses.

However, experts warn that the 25 per cent tariff increase will be more significant for the aluminium industry. The US has previously imposed a 10 per cent tariff on aluminium imports, but with the increase to 25 per cent, exporters will face significant cost pressures.

Trương Hoàng Nam, Director of EuroHa Joint Stock Company — a major aluminium exporter to the US with an annual turnover of over US$7 million — expressed concerns over the new tariffs. He noted that at 10 per cent, Vietnamese aluminium could still compete, but at 25 per cent, higher production costs could lead to losing customers.

EuroHa is currently working with the Vietnam Aluminium Association and the Trade Remedies Authority of Việt Nam to assess the situation and explore solutions to mitigate potential losses.

Economic expert Đinh Trọng Thịnh sees the new US tariffs as both a challenge and an opportunity. While the higher tariffs will make it harder for Vietnamese exporters to compete on price, he highlights that other markets like the EU, Canada and Mexico are also subject to the same tariff rates. This means Việt Nam’s competitiveness is not uniquely affected.

For the steel industry, Thịnh believes Việt Nam still has opportunities in the US market. He explained that many countries that previously enjoyed lower tariff rates were now facing the same 25 per cent tariff, which could level the playing field for Vietnamese steel exports.

However, for aluminium, he acknowledged that Vietnamese businesses would be under more pressure, as the higher tariffs could reduce demand, forcing companies to re-evaluate their pricing strategies.

Dương Đức Quang, Deputy General Director of the Vietnam Commodity Exchange (MXV), advised exporters not to panic but rather to adapt proactively. He emphasised the importance of enhancing internal capabilities and improving production efficiency while also seeking out new markets to reduce reliance on the US.

Investing in advanced technology to produce higher-value aluminium products and working closely with government agencies to navigate trade policies could also help mitigate the impact of the tariffs, he said.

Quang also recommended that companies diversify their export markets by focusing on countries with free trade agreements with Việt Nam to avoid excessive reliance on the US.

Thịnh agreed, underscoring the need to boost domestic consumption. He argued that the steel and aluminium sectors should develop the domestic market to reduce reliance on major export destinations like the US. Optimising logistics and lowering production costs would further improve competitiveness.

While the 25 per cent tariff will pose difficulties for Việt Nam’s aluminium and steel exporters, experts agree that it is not an insurmountable barrier. The tariff applies broadly to all exporting countries, meaning that Việt Nam remains competitive on a global scale.

US Ambassador to Việt Nam Marc Knapper reaffirmed that the US continued to value its trade relationship with Việt Nam. He highlighted that 2025 marked the 30th anniversary of diplomatic relations between the two nations and expressed optimism about expanding economic cooperation.

Viet Nam News – February 26, 2025